When entering into a Baja real estate transaction, there are many important parties who will ultimately form part of the process. It’s very important that none of these parties be overlooked, and that all be kept in communication with the rest so that everything flows smoothly.
The first and most obvious parties in the transaction are the buyer, the seller, and their respective agents. After all these parties have come to a final agreement regarding price and terms, the real work begins, and the rest of the parties come into play.
At this point, the most important party will be the closing coordinator. He will be the focal point for the rest of the transaction, like the quarterback of the team, communicating with all other parties and coordinating all the details until the closing. His goal is to complete the transaction in a timely manner, usually within 30-60 days.
The closing coordinator’s first responsibility is to make sure that all documentation from all parties is gathered, completed correctly, and presented to the notario, who will be responsible for the final closing of the transaction and the transfer of rights from the seller to the buyer.
The closing coordinator will also work closely with the escrow officer, who will be responsible for the transfer of funds from the buyer to the seller upon closing. The escrow officer will probably be located in the U.S., but will remain in contact with the buyer through the closing coordinator.
The closing coordinator will hire an appraiser to go to the property and do an evaluation of its value for tax purposes. Along with the appraiser, a land surveyor will usually be sent to verify the boundaries of the property, confirming that the land being advertised is in fact the legal parcel being sold.
The next party is the bank officer from the bank that will be holding the fideicomiso, or bank trust for the property. This bank officer will be responsible to send a letter to the Secretary of Foreign Affairs requesting the necessary permits for the bank trust and forwarding those permits to the notario who will actually write the bank trust.
Another important player in your Baja real estate transaction is the Secretary of Foreign Affairs in Mexico City. The closing coordinator and bank officer will be responsible to communicate with him. The Secretary will verify that the buyer has a permit to purchase land in Mexico and do a background check of the buyer in his country of origin to be sure he is not wanted by the law and that he is using legitimate monies to purchase the property.
Before a date can be set for the closing, the closing coordinator must get certificates from the municipality and the Home Owners’ Association (HOA) of the property proving that there are no liens on the property. This includes but is not limited to water or electrical liens, lawsuits, municipal or tax liens, and HOA fees. While HOA debts may not affect the sale of the property, it is good to resolve them before closing rather than surprising the buyer with a debt later on.
The last important party should be a Property Inspector. His thorough inspection will give the buyer peace of mind that the home is in good condition and worth the appraised value. The property inspector will present a detailed written report of all features of the property. In the event that something is revealed causing the buyer to change his mind about the purchase, this report can be used to terminate or modify the transaction.
This is a basic overview of the players involved in a Baja real estate transaction. Later, we will go into a more detailed analysis of the roles of each of these parties. For now, know that the majority of these parties can be found in the local area of the property you are purchasing, and your agent should be able to help you get started locating them.